Bitcoin, the largest cryptocurrency by market value, declined by 8% to $91,377.32 at the end of November 26 after rising to $99,830 on November 22. As reported by Reuters, the downturn below $100,000 puts more pressure on traders since they expect new corrections before the December contract expirations.
However, Bitcoin has declined recently, though it rose by 120% in the last year, out of which it gained 34% in November. Analysts have attributed the rally to the victory of U.S. President-elect Donald Trump, who has expressed willingness to make the country the Bitcoin hub and hold a 'National Bitcoin reserve.'
One significant event on the Bitcoin market calendar is December 27, when the total value of Bitcoin options equals $11.8 billion. Experts state that it could become active as large fluctuations in trading are likely to be observed at this time. Nick Forster, the decentralized options protocol Derive founder, observed that the call put skew for this expiry has been reduced by 30% in the past day. This respective implies that the traders' level of hedging is going on by observing the difference between call and put options through this implied volatility.
Forster pointed out that it has a 68% probability of either being lower at $81,493 or higher at $115,579 by December expiry. Such a high correlation of probabilities indicates the chances of a significant price shift in this market.
Another reason for the recent dump has been attributed to long-term Bitcoin holders starting to sell. Data shared by Popular Investor indicates that investors who intend to have Bitcoin in the long term have sold $60 billion in the last 30 days. This represents the largest distribution by this group during the current market cycle.
As per checkonchain.com report long-term holders moved 21% of the supply since Bitcoin's low of $15,479 during the FTX collapse in November 2024. This marked a significant profit-taking event, further weighing on market sentiment. Experts agree that such sell-offs are not unusual in bullish cycles but may influence short-term price trends.